Did you know that 1 in 20 workers worldwide is a migrant?
The migrant experience, it’s a powerful one.
In an environment where we’re talking about global inclusive growth, this entire group
of people is being left behind and ignored.
A migrant worker is defined as someone who lives and works in a country where they don’t
hold citizenship.
And some 67% of migrant workers reside in high-income countries.
That’s nearly 114 million people.
So, what are the ways their presence bolsters an economy, and what are the challenges that
lie ahead?
The growing speed of economic globalization has created more migrant workers than ever
before.
As long as there’s been history, people have been going overseas to work.
And it’s connected with the economic cycles as well.
That’s Sri Jegarajah.
He’s a Singapore-based senior correspondent for CNBC and has covered international markets
for over 15 years.
Sri, it’s really great to have you here.
It’s my pleasure, Nessa.
There’s a lot that we can unpack about migrant workers right, but we’re focusing now on
their impact on the global economy.
And seeing that many are concentrated in wealthy countries, is it just the appeal of well-paying
jobs that’s motivating them?
There are a number of push and pull factors.
What it comes down to is the dynamics of the international labor markets.
And it’s exactly like that, it’s exactly like a market.
You go where you get the best price for your unit of labor, whether you are skilled, unskilled
or semi-skilled worker.
That dictates the flow.
Then of course, globalization.
The increasingly interconnected world has just accelerated those trends.
The barriers to entry have come down in the workforce.
There are the demographics involved.
Fertility rates have been falling, low birth rates, higher ageing population, and that
depletes the available pool of labour, creates the dynamics for entrants into the economy.
But who are the biggest drivers of a migrant workforce?
In 2020, the top three sources for remittances, which is the money workers send home, were
the United States, United Arab Emirates and Saudi Arabia, all high-income countries.
In the same year, the top 5 recipient countries for remittances inflows were India, China,
Mexico, the Philippines and Egypt, all low to middle-income countries.
In fact, India has received the highest number of remittances since 2008.
The foreign exchange factor is a big driver in terms of the flow.
So if you take the Singapore example, many foreign workers, migrant workers who work
in the construction industry, in the shipbuilding industry, from Bangladesh and from India for
example, Sri Lanka too, come here because they can remit their salary in Singapore dollar
terms back to their families, which will inevitably mean more currency in their bank account,
better standard of living for their family.
Is it just the pay that’s drawing them?
It's not necessarily a case of country A, which is lower to middle income, workers there
looking at country B, which is at a higher stage of economic development, better prospects,
higher exchange rate and thinking, I'll have a piece of that.
It is across different countries of different rates of economic development.
An example was the U.K. in the 80s.
There were many British construction workers who went to work in Germany, when the Berlin
Wall came down during the East-West reunification, because there were opportunities.
So that’s an example of the higher-income country, not necessarily a developing country,
where the workforce and labor have shifted.
It’s a broad global theme that manifests itself in different ways across the income
spectrum.
What are some of the commonalities of low-income countries who are providing these migrant
workers?
Countries like Indonesia, Bangladesh, like the Philippines, they’re still trying to
move higher up the value chain.
They’re at that stage of economic development where it’s a lot of agriculture, a lot of
manufacturing.
And they have not yet fully developed a higher-value tech industry, for example.
So those workers, who may even want to transition, may not be able to do so because the infrastructure
isn’t there, the upscaling isn’t there and they are stuck.
And they see the prospects, with the skills that they have, are better in other countries
within Asia, Singapore, Malaysia for example.
And they gravitate there.
While there is no internationally accepted statistical definition of labour migration,
they are usually categorized by the sectors they work in.
And the challenges differ according to their skillset.
You have varying degrees of exclusion, varying degrees of injustice, when it comes to the
issues of basic pay, working conditions, living conditions, recourse to basic labor rights
and advice.
In fact, there are very strong laws that are put in place to protect and safeguard their
rights.
It’s enforcing those laws that’s the tricky part because that comes down to the companies
that employ them.
And typically, many of these companies, many of these contractors and subcontractors, it’s
not really a huge priority for them.
According to Human Rights Watch, Qatar’s two million migrant workers make up an estimated
95% of the country’s workforce.
The country has faced intense international scrutiny over its treatment of migrant workers16
since it won the 2010 bid to host the World Cup in 2022.
And many of them are in debt.
Pre-pandemic, that was a big, big problem.
Also, there is no basic insurance or health coverage for when these men are hurt in an
accident in the workplace.
The vulnerability of migrant workers was highlighted even further with the pandemic18, as borders
were closed and mobility was heavily restricted.
A lot of these men and women cannot go back because of the restrictions in their own country,
and have to stay here and have to work because of the economic desperation in their own country.
The situation is quite different for migrant workers who still had their jobs in their
host country.
For example, at one point in December 2020, almost half of migrant workers living in packed
dormitories in Singapore had had a Covid-19 infection.
Social distancing in a dormitory, where there are 12 men sleeping there and using that as
their living quarters, transmission will happen.
Covid will spread.
And that happened.
We saw that.
We saw that in Singapore, we saw in Malaysia, we saw that in Thailand.
If there was anything good that came out of this pandemic, it did shine a much-needed
light on the living conditions of these workers in Singapore, and I'm sure it's the case all
over the world as well.
Despite the challenges, migrant workers provide a great benefit not only to their host country,
but for the countries they hail from.
What does it bring a country?
And I think it brings a country an incredible diversity, richness and economic benefit.
It will benefit the broader economy because of a lot of demographic challenges related
to low birth rates, the ageing population.
Those are really challenging, longer-term, big structural demographic questions that
are not going to be resolved anytime soon.
The money migrant workers send back home is such a lifeline to the families who are receiving
them.
So, the official record of remittance flows to low and middle-income countries was $540
billion in 2020.
If we're going to start to think seriously about global inclusive economic growth, then
it cuts both ways as well.
I think many of the countries, the countries where they are from, start thinking seriously
about how can we reconfigure our economy, to make it more attractive for this pool of
labour that feel that there are no opportunities or the opportunities are better overseas because
of the income and the exchange rate.
How can we retool and reconfigure our economy, to offer a value-added incentive for them
to stay in that country?
Because after all, they are assets.
And losing them to another country is, yes it's part of labour mobility, but I think
it also says a lot for the lack of a longer-term structural plan to really take the economy
to the next stage in those countries.
Over time, migrant workers – both high- and low-skilled - bring substantial economic
benefits to their host countries, especially high-income ones.
Addressing the shorter-term challenges could be the key to maintaining this progress.
Sri, did you know that three out of four of my grandparents are migrants and they all
worked here.
I think everyone has that story, you know, “bring me your huddled masses yearning to
breathe free.”
And my parents, it’s something that resonates with me as well.
The civil war in Sri Lanka escalated and really started to take a turn for the worse.
My parents came to the UK in 1968.
My father wanted to improve his skill set as a doctor, and we made our lives there.